Costs of electric vehicles

Cars aren't cheap, but fuel and maintenance costs less

When the Tesla Model S debuted and promptly won the 2013 Motor Trend Car of the Year award, the consumer was sent a strong message. No longer was an electric car about compromise, at least when it came to looks, comfort and quickness.

But at a purchase price of over $90,000 in Canada, the Tesla S is a dream car for many. So one question remained? Is an electric car an affordable option for the more typical consumer?

The good news is that in the last couple years, there have been enough electric vehicles with a price of under $40,000 – available right here in B.C. – to ignite serious debate about affordability. Even though the initial purchase price of an electric car is higher than most similar-sized internal combustion engine equivalents, the yearly savings on fuel and maintenance make for some interesting math.

A study by Bloomberg Energy Finance, as reported in theguardian.com, predicts that electric vehicles will become cheaper than gas-powered vehicles in overall ownership cost by 2022. Of course, BC Hydro's low electricity prices could accelerate that tipping point here in B.C.

Fuel costs: electric's the big winner

The Canadian Automobile Association's vehicle cost calculator is a good place to start when investigating ownership costs. Using the electric vehicle calculator option, here are some fuel cost comparisons – using 20,000 kilometres of driving a year as the constant - between electric and internal combustion powered vehicles:

2016 Nissan Leaf S: $400 vs. $1,872 for a gas-powered compact car

2016 Chevy Volt: $568 vs. $1,872 for a gas-powered compact car

2016 BMW i3: $396 vs. $1,872 for a gas-powered compact car

2016 Tesla S (P90D): $532 vs. $2,076 for a gas-powered, full-size car

Yearly maintenance costs: electrics win again

Brakes in an electric vehicle could last 300,000 km or more before requiring service, as the bulk of braking in an electric vehicle is regenerative, in which the electric motor slows down the vehicle while recharging it at the same time. And there are no oil changes.

One study concluded that, over an eight-year-period, maintenance on an electrical car is about a third cheaper than maintenance on a car with an internal combustion engine. There are just fewer parts to cause problems in a relatively simple electric motor.

And then there's the longevity of the electric motor, which at least one analysis suggests could deliver more than two million kilometres of trouble-free motoring compared to an internal combustion engine's typical life expectancy of about 320,000 km.

Replacement battery pack: A major cost for electrics

While auto manufacturers say costs of replacement battery packs are about to decrease dramatically, right now you're typically looking at upwards of $5,500 US. Many EVs come with a battery pack capacity loss warranty of 5 to 8 years, but it's wise to consider all costs when doing the math on your investment.

It has become somewhat of a target for the makers of electric vehicles to produce batteries that are available for $150 US per kilowatt-hour (the Nissan Leaf's new battery pack is 48 kWh), as current prices are about $350 US per kWh. But that $350 represents a huge decrease from only a few years ago, as one study shows that between 2007 and 2014, battery pack prices decreased an average of 14% a year.

Used electric vehicles offer mix of savings, compromise

As automakers roll out new, improved electric vehicles, some drivers are jumping at the chance to upgrade. The result is a lot of used electric vehicles are on the market, many at much lower prices than new EVs, particularly in the U.S.

The hitch is that battery packs degrade as they age, so depending on the model and year, electric range on older-model electric vehicles can be 80% (or less) than they were when they were new. For some drivers, particularly in urban areas, that's a sacrifice they can live with. And as the cost of replacement battery packs goes down each year, buying a used EV with the intent of replacing the battery pack down the road becomes more viable.